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Gold prices extend gain; physical buying slows

Source : REUTERS
Last Updated: Thu, May 09, 2013 10:22 hrs
Gold jewellery shop owner arranges ornaments at a counter in Kolkata

Gold futures edged higher to extend gain for another session on Thursday, helped by a weaker rupee, amid slowing purchases from physical traders ahead of a key gold-buying festival next week.

India, the world's biggest buyer of the metal, will celebrate Akshaya Tritiya next week, the biggest gold-buying festival after Dhanteras. The wedding season is on and will continue through July.

"Demand has slowed down compared to last week. If it comes to 26,000 rupees, we might see some more buying," said a dealer with a private bullion-importing bank.

"It has been two months that traders have been stocking up...," said the dealer, referring to the Akshaya Tritiya festival, scheduled next week.

Most traders picked up bargains after prices fell to their lowest level in 18 months in April.

The rupee, which weakened on Thursday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

At 3:37 p.m., the actively traded gold for June delivery on the Multi Commodity Exchange (MCX) was at 27,180 rupees per 10 grams, due to a weaker rupee.

Silver for July delivery on the MCX was 0.77 percent higher at 45,255 rupees per kilogram.


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